- 15 -
position would also infringe upon the statute of limitations by
allowing petitioner affirmatively to recover time-barred
overpayments. Nevertheless, petitioner asks us to expand the
application of equitable recoupment beyond what any court has
ever done. In the final analysis, we agree with the following
observation of the Court of Claims:
If the doctrine of recoupment were a flexible one,
susceptible of expansion, it might well be applied in
the instant case. But the teaching of Rothensies is
that it is not a flexible doctrine, but a doctrine
strictly limited, and limited for good reason. [Ford
v. United States, 149 Ct. Cl. 558, 569, 276 F.2d 17, 23
(1960).]
14(...continued)
It probably would be all but intolerable, at least
Congress has regarded it as ill-advised, to have an
income tax system under which there never would come a
day of final settlement and which required both the
taxpayer and the Government to stand ready forever and
a day to produce vouchers, prove events, establish
values and recall details of all that goes into an
income tax contest. Hence, a statute of limitation is
an almost indispensable element of fairness as well as
of practical administration of an income tax policy.
We have had recent occasion to point out the reason and
the character of such limitation statutes. "Statutes
of limitation * * * are designed to promote justice by
preventing surprises through the revival of claims that
have been allowed to slumber until evidence has been
lost, memories have faded, and witnesses have
disappeared. The theory is that even if one has a just
claim it is unjust not to put the adversary on notice
to defend within the period of limitation and that the
right to be free of stale claims in time comes to
prevail over the right to prosecute them." Order of
Railroad Telegraphers v. Railway Express Agency, 321
U.S. 342, 348-9. * * *
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